Paying commission or finder's fee

[Jesse Redman]

I recently met someone who's customers may very often want or need video production. I have started a conversation about supplying this person's customers with my services.

In our talks, this person has stated that they do not want to be involved in my business transactions, i.e. I should make all arrangements, set pricing and collect all debts.

What is a standard "commission" or finder's fee, when this person may be directing business my way on a regular basis?

[Glenn Davidson]

In 25 years of running my own audio and video company, I have never paid a commission on work refered to me and almost all of my work is by referral. I think if you offer a good service no commission is required. The referer will benefit from the good will created by a job well done. I have referred jobs back to the other company, but never a commission. I don't think there is a standard rate. Perhaps a bottle of wine during the holidays?

[Andrew Kimery]

Originally Posted by Glenn Davidson

In 25 years of running my own audio and video company, I have never paid a commission on work refered to me and almost all of my work is by referral. I think if you offer a good service no commission is required. The referer will benefit from the good will created by a job well done. I have referred jobs back to the other company, but never a commission. I don't think there is a standard rate. Perhaps a bottle of wine during the holidays?

I was gonna say the same thing. Now, if this person was an agent or something where their job was to find you work, then that'd be another story. But since it sounds like a business relationship that benefits both parties I don't think a fee should be involved.


-A

[Ash Greyson]

Same here, almost ALL referral work and not one penny ever paid in commission. I think people who think they deserve commission are minimal humans. There are cases with huge projects where there are middlemen "producers" who are the gateway to money and those people usually get money but for a referral? NO WAY!



ash =o)

[Jesse Redman]

Thank you for the replies.

Would the answer still be the same if:
1) Referring their customers to you was almost a part of their "package"
2) They referred almost every customer they had to you.
3) A major portion of your business came from these referrals.
????

[Brian Wells]

Originally Posted by Jesse Redman

In our talks, this person has stated that they do not want to be involved in my business transactions, i.e. I should make all arrangements, set pricing and collect all debts.

Tell him if he wants a "commission" then he should be involved in all business transactions, make all the arrangements, set pricing, and be solely responsible for paying suppliers (such as you) and collecting all debts. See, what people like him fail to realize is that "commissions" or "profit" are earned by the people who take risks, not the people who avoid them.